Month: May 2014

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via Zero Hedge http://ift.tt/1hmNmHr williambanzai7

There was much said in last week’s primetime interview between Edward Snowden and NBC’s Brian Williams. But perhaps more interesting than what was said in the one hour time-slot, was what was contained in the three extra hours of conversations that were not broadcast, such as Snowden’s questioning of the American intelligence community’s inability to stop the September 11, 2001 terrorist attacks. One such segment, as transcribed by RT, involves the former NSA contractor’s response to a question from Williams on how to prevent further attacks from Al Qaeda and other “non-traditional enemies” in which Snowden suggested that United States had the proper intelligence ahead of 9/11 but failed to act.

“You know, and this is a key question that the 9/11 Commission considered. And what they found, in the post-mortem, when they looked at all of the classified intelligence from all of the different intelligence agencies, they found that we had all of the information we needed as an intelligence community, as a classified sector, as the national defense of the United States to detect this plot,” Snowden said. “We actually had records of the phone calls from the United States and out. The CIA knew who these guys were. The problem was not that we weren’t collecting information, it wasn’t that we didn’t have enough dots, it wasn’t that we didn’t have a haystack, it was that we did not understand the haystack that we have.”

Or, as some have suggested over the years, it was not that “we” did not understand the haystack. Quite the contrary. Which is precisely why the attacks took place. But back to the accepted narrative:

“The problem with mass surveillance is that we’re piling more hay on a haystack we already don’t understand, and this is the haystack of the human lives of every American citizen in our country,” Snowden continued. “If these programs aren’t keeping us safe, and they’re making us miss connections — vital connections — on information we already have, if we’re taking resources away from traditional methods of investigation, from law enforcement operations that we know work, if we’re missing things like the Boston Marathon bombings where all of these mass surveillance systems, every domestic dragnet in the world didn’t reveal guys that the Russian intelligence service told us about by name, is that really the best way to protect our country? Or are we — are we trying to throw money at a magic solution that’s actually not just costing us our safety, but our rights and our way of life?

This goes to the fundamental argument that made Snowden blow the whistle in the first place: by overreaching to a level not fathomed even by the author of “1984”, and by scrambling to collect every piece of electronic communication and data exchange, or said otherwise, shotgunning and focusing on the bulk instead of isolating actionable data, what is the tradeoff?

We do know that handing all private data to the NSA on a silve platter has certainly resulted in an abuse of personal privacy by those tasked with protecting Americans as we detailed in the past in “NSA Agents Used Company Resources To Spy On Former Spouses.” Who knows how else this epic trove of private data is being abused by the government for its own ulterior motives, while letting, as Snowden suggested, critical information about the protection of US citizens – the very premise behind the NSA’s existence – slip through its fingers.

Indeed, the director of the NSA during Snowden’s stint there, Gen. Keith Alexander, reportedly endorsed a method of intelligence gathering in which the agency would collect quite literally all the digital information it was capable of.  “Rather than look for a single needle in the haystack, his approach was, ‘Let’s collect the whole haystack,’” one former senior US intelligence official recently told the Washington Post. “Collect it all, tag it, store it. . . .And whatever it is you want, you go searching for it.”

 

In recent weeks, a leaked NSA document has affirmed that under the helm of Alexander, the agency was told it should do as much as possible with the information it gathers: “sniff it all, know it all, collect it all, process it all and exploit it all,” according to the slide.  “They’re making themselves dysfunctional by collecting all of this data,” Bill Binney, a former NSA employee-turned-whistleblower himself, told the Daily Caller last year. Like Snowden, Binney has also argued that the NSA’s “collect it all” condition with regards to intelligence gathering is deeply flawed.

 

“They’ve got so much collection capability but they can’t do everything. They’re probably getting something on the order of 80 percent of what goes up on the network. So they’re going into the telecoms who have recorded all of the material that has gone across the network. And the telecoms keep a record of it for I think about a year. They’re asking the telecoms for all the data so they can fill in the gaps. So between the two sources of what they’ve collected, they get the whole picture,” Binney said.

 

Although NBC neglected to play Mr. Snowden’s remarks to Williams in which he questioned the efficiency of modern intelligence gathering under the guise of being a counterterrorism tool, it did air on television other remarks from the former contractor concerning the terrorist attacks.

Stepping back, this really is a debate about government efficiency, incentives and motives. The biggest problem with the NSA, or rather its modus operandi, according to Snowden is not that it does not have the architecture to use the data already in its possession to isolate and prevent incidents of terrorism: it did, and arguably it had enough facts in its (and the CIA’s) possession to prevent the September 11 attack, and it certainly was equipped with enough surveillance to prevent the Boston Marathon bombing, yet it didn’t. In the meantime, the information grab is expanding until Big Brother, under the guise of (failed) protection now knows everything about its citizens. Simply said: this is merely government bloat in its most purest – spending ever greater amounts of money to become increasingly more inefficient, in the process destroying the concept of individual privacy.

Or as Snowden himself said it in a fragment that was aired,

“It’s really disingenuous for the government to invoke and scandalize our memories to sort of exploit the national trauma that we all suffered together and worked so hard to come through to justify programs that have never been shown to keep us safe, but cost us liberties and freedoms that we don’t need to give up and our Constitution says we don’t need to give up.”

Sadly, until the people themselves wake up to this conclusion which prompted one person to speak up against a broken system, all of his efforts will have been largely in vain.

via Zero Hedge http://ift.tt/RPYVKR Tyler Durden

The European Central Bank meeting is on June 5.  It is among the most important events of the first half and possibly the entire year.  After much preparation and jawboning, the ECB is widely expected to take unconventional measures counter the low inflation and risk of deflation.  It may also announce fresh initiatives to help facilitate financing for small and medium sized businesses. 

 

In anticipation of this, the euro has been sold.  It declined by about 1.8% on the month.   The net speculative position in the futures market swung to favor shorts.   We suspect the market is particularly vulnerable to “sell the rumor and buy the fact” activity.  This is what has happened when the Fed has announced its quantitative easing programs:  the dollar would sell off in anticipation and then rally on the announcement. 

 

The euro’s four cent decline pushed it below $1.3600 briefly.   The 38.2% retracement objective of the rally off last July’s lows is found near $1.3520.  However, the decline has stretched the technical indicators.  The RSI has already turned up, and the MACDs are about to cross higher.  

 

This dovetails with our suspicion of “sell the rumor buy the fact” behavior in response to the ECB.  This may be counter-intuitive, but this is essentially what happened in the past.  When the Fed announced QE, it was often well anticipated, and the dollar sold off until it was announced and then rallied.   We suspect that the challenges the ECB faces are not something that 10-15 bp of rate cuts, and even a negative deposit rate, will convincingly address.   Once the event risk passes, investors may return to form and chase yield. 

 

If this analysis is correct, what kind of bounce can the euro have?  The first objective is the $1.3720-40 area,    The next target would be in the $1.3780-$1.3820 area.  If  the ECB does genuinely surprise, the $1.3520 is the initial target on a break of $1.3580. 

 

Sterling declined 3 cents against the dollar in May.  This was among its worst monthly performances in the past year.  The technical outlook is somewhat similar, though sterling’s 200-day moving average (just below $1.6400) was not tested.  The RSI has turned up, but the MACDs do not appear as close to turning as the euro’s.  The initial upside objective is the $1.6810-40 band.  On the downside, a break of the $1.6700 area risks a move toward $1.6625. 

 

There are two forces underpinning the yen.  First, the US 10-year premium over Japan has fallen to its lowest level since last August.  Second, market expectations of new stimulus by the BOJ are being reconsidered.  Previously the overwhelming majority expected new measures by the end of July.  We have long argued this was jumping the gun and, if there is to be more monetary stimulus, it would likely be later. 

 

 

The technical indicators for the yen are broadly neutral.  The two yen range that confined the dollar in May looks set to continue.  A trend line off the April high near JPY104.10 and the May high near 103 caught the past week’s high near JPY102.15.  On the downside, the dollar, the market appear cautious about pushing the dollar much below the 200-day moving average found near JPY101.40. 

 

Over the past two week, the euro has carved out a shelf near JPY138.  Technical signals here seem clearer than against dollar-yen.  Provided the shelf holds, the euro can rise toward JPY139.65 and possibly JPY140.  This fits in well with a sell the rumor buy the fact activity around the ECB meeting. 

 

The Canadian dollar was the strongest major currency in the month of May, appreciating 1% against the US dollar.  However, the US dollar recorded a low near CAD1.0815 on May 8-9 and the retest at the end of last week was aborted after the weaker than expected Q1 GDP figures (1.2% rather than 1.8% consensus) and industrial product prices actually declined (-0.2% whereas the consensus anticipated a 0.4% rise).  

 

The Bank of Canada, which meets on June 4, is particularly sensitive to the downside risks of inflation.  It follows soft retail sales and jobs report.  No rate cut can be reasonably expected, but a dovish statement could see the US dollar move back toward CAD1.0950. 

 

 

The Australian dollar was the best performing major currency last week, rising about 0.8% against the greenback.  This was roughly four times the advance of the yen, which was the strongest currency.  The decline in global interest rates helped solidify the $0.9200 base, which was tested half a dozen times in May.   The downtrend line drawn off the April and May high comes near $0.9375 at the end of next week.  However, more immediate resistance near $0.9335 held Aussie upticks in check ahead of the weekend.  Support is pegged near $0.92870-85. 

 

The Mexican peso was flat in the past week, though the dollar saw its recent losses extended toward MXN12.825, which represents the new 2104 low.  The RSI and MACDs look neutral, but fresh downticks have been difficult to sustain.   There has been a large build-up of speculative peso longs in the futures market.  A dollar advance through the MXN12.90 would encourage a test on the down trendline drawn off the late-January high, the March high and the late April high.    It comes in near MXN12.95.  

 

 Observations from the speculative positioning in the CME futures market:  

 

1.  With a couple week lag behind the euro, the net speculative position swung to the short side for the Swiss franc in the latest Commitment of Traders report that covers the week through May 27.  It is the first net short franc position in three months.  

 

2.  The net speculative position is short four of the seven currency futures we track here:  euro, yen, Swiss franc and Canadian dollar. 

 

3.  There were no major (10k contract shift of more) gross position adjustment over the past week.  The largest position adjustment was the gross long peso positions, which grew 9.1k contracts to 101.8k. This is the largest gross long position since last June.  The net position of 83.3k contracts is also the largest since last June.

 

4.  The general pattern in the latest reporting period was for the gross short currency futures positions to have increased.  The only exception was for sterling.   Gross shorts were pared by 3.8k contracts to 43.1.  The gross long positions were cut for the euro (-4.3k contracts to 70.8k), the yen (-1.7k contracts to 17.0k), sterling (-1.6k contracts to 78.4k) and the Swiss franc (-5,8k contracts to 11.6k). 

 

5.  The other three currencies saw an increase in the gross long positions: Canadian dollar (+6.1k to 32.6k contracts), the Australian dollar (+1.9 to 52.k contracts), and the Mexican peso, that we already discussed as the largest gross position adjustment. 

 

6.  The month of May saw the net speculative position for both the euro and franc shift to the short side. During the month, the net short yen and Canadian dollar positions were reduced, while the net long sterling position was also cut.  The net position in the Australian dollar was little changed.  The net long peso position grew. 

 

7.  Given the focus on the US bond market rally, we looked at the Commitment of Traders for the 10-year Treasury note futures.  There was a large adjustment to positions.  Both long and shorts were cut. The latter more than the former and this led to sharp reduced in the next short position to 19.1k contracts from 97.9k.  The gross short position was slashed by 131k contracts to 398.4k.  This is the largest short covering since December 2012.  The gross short position returned to late April levels. The gross long position was cut by 52.1k contracts to 379.3k.  Up until now there was no evidence from the futures market that the bond rally was a product of short-covering.  The reporting week ending May 20 saw the net short position rise to it highest level since before the financial crisis.

via Zero Hedge http://ift.tt/1odvnS4 Marc To Market

Submitted by Mike Krieger of Liberty Blitzkrieg blog,

With real incomes stagnant and the cost of everything from food, school tuition and healthcare premiums skyrocketing for millions of Americans, it appears that borrowing against one’s home is once again a key source for consumption, if not survival, for the nearly extinct socio-economic demographic known as the middle-class.

The Wall Street Journal reported yesterday that home-equity lines of credit (Helocs) had increased at a 8% rate year-over-year in 1Q14. Some banks are more aggressive than others, and perhaps we shouldn’t be surprised to see TBTF government welfare baby Bank of America leading the charge, with $1.98 billion in Helocs in the first quarter, up 77% versus 1Q13.

What could possibly go wrong?

 

As HELOC delinquencies are off their highs (for now) but remain elevated… (we are sure this renewed ATM usage on the back of created wealth and stagnant wages won't harm that downward trend at all…) – will we never learn?

 

From the WSJ:

A rebound in house prices and near-record-low interest rates are prompting homeowners to borrow against their properties, marking the return of a practice that was all the rage before the financial crisis.

 

Home-equity lines of credit, or Helocs, and home-equity loans jumped 8% in the first quarter from a year earlier, industry newsletter Inside Mortgage Finance said Thursday. The $13 billion extended was the most for the start of a year since 2009. Inside Mortgage Finance noted the bulk of the home-equity originations were Helocs.

 

While that is still far below the peak of $113 billion during the third quarter of 2006, this year’s gains are the latest evidence that the tight credit conditions that have defined mortgage lending in recent years are starting to loosen. Some lenders are even reviving old loan products that haven’t been seen in years in an attempt to gain market share.

 

Some individual banks have seen their Heloc originations rise much faster than the national average. Bank of America Corp., which has increased marketing for Helocs, said customers opened $1.98 billion in Helocs in the first quarter, up 77% from the first quarter of 2013. Matt Potere, who leads Bank of America’s home-equity business, said many customers are taking out Helocs to pay for home-improvement projects that were delayed during the housing bust.

 

Some lenders are even bringing back “piggyback” loans, which serve as a second mortgage and cover part or all of the traditional 20% down payment when purchasing a house. Piggybacks nearly vanished during the mortgage crisis.

 

For consumers in need of cash, Helocs offer an alternative to “cash-out refinancings” in which a homeowner taps equity by taking out a new loan that is bigger than the existing mortgage.

 

Ian Feldberg planned to open a $200,000 Heloc this week with Belmont Savings Bank to help pay his son’s college tuition. The medical-device scientist purchased his home in Sudbury, Mass. for a little over $1 million in 2004, and estimates that its value dipped as low as $800,000 during the financial crisis. However, after applying for the line of credit, he found that its value had completely recovered.

 

“I’m very pleased about that. My options for tuition fees were either that or to cash in on my pension prematurely,” he said.

Think about that for a minute. A “medical-device scientist” can’t send his kid to college without either a Heloc or cashing in on his pension.

The new American Dream.

Full article here.

via Zero Hedge http://ift.tt/1mWjmkN Tyler Durden

US stocks continue to breach record levels while highly rated government bond yields slide – – all with the prospect of continued support from the world’s central banks.

Indeed, expectations that the European Central Bank would unveil a package of supportive policy measures when it meets next week were bolstered by the release of select weak eurozone stats. It must be noted that all this cheap money is finding its way into various asset classes, most notably equities and debt products. Hence, record levels for Wall Street alongside historically low sovereign bond yields.

This wild euphoria is supported somewhat by signs of an improving economic environment, notably in the US, but remains way ahead of market fundamentals. U.S. government bonds are heading for a fifth monthly gain, the longest since 2006, as growth — but not rapid growth — underlined an appetite for long-term debt of all stripes. The new ranking of global competitiveness has just been released and underscores some of the key themes in these pages. The US leads, Europe struggles to recover, and big emerging markets grapple with some new realities.

Given the ever tighter spreads and the relentless march of markets, some, including the European Central Bank, have warned that investors’ wild pursuit of higher returns could be creating new price bubbles, sounding the alarm as financial markets chase quick gains. In a strongly worded message they clearly underscored concerns that have been penned in these pages as well, There may be an ugly downside to runaway market enthusiasm. The ECB cautioned that the dash for higher returns could suddenly unravel, sending the investor herd charging in the opposite direction.

…

Easy money and the timing of the Fed’s policy shift continue to dominate across the globe. Recovery is widely assumed for the next two years. But deep-seated weaknesses have also become more evident.

 

 

Very obvious financial vulnerabilities, repercussions from various political stalemates and serious geopolitical concerns are aggravating the problems of clearly insufficient growth in the world economy. And let’s not forget that many of the challenges cannot be resolved easily…

Full Abe Gulkowitz The PunchLine letter below…

TPL May 29 14

via Zero Hedge http://ift.tt/1kWVVaS Tyler Durden

Welcome to the new normal reality of job-hunting in 2014… “Our venture-funded vertical-driven content prosumer phablet platisher is rapidlygrowing and we need to add some Ninja Rockstar Content Associates A.S.A.P. See below for a list of open positions!”

 

Originally posted at Medium.com, written by Paul Ford,

As explainer sites like Vox.com and FiveThirtyEight.com grow in importance, we are seeking a first-class EXPLAINER EXPLAINER to help readers make sense of the people who would make sense of the world for them. You will have the enviable position of capturing recent trends in explainers by writing between five and ten blog posts a day outlining those trends. While most of your time will be spent creating explainer explainers, you will also occasionally round up other explainer explainers to create explainer explainer explainers. To apply, explain yourself.

The modern newsroom is data-driven and traffic-driven. That’s why we’re looking for a DATA CHURNALIST. Like John Henry battling against the steam hammer, you will be responsible for tunneling through mountains of Excel spreadsheets and government FTP files to produce at least two dozen articles a day illustrated with pie charts. Also like John Henry you won’t be in a union. The ideal candidate has proven experience in correlating.

Feminism is changing—we’re changing with it! Our legendary women’s vertical launched as “Dworkinville” (2001-2007), was renamed “Ladies.biz” after a rollup (2008-2009), then re-rebranded as “Slutbox Junction” (2010-2014). Now we’re just calling the site “Tits” and targeting it to men 15-79. Our last editor (aka Edit Queen) left to work for some magazine with salaries, so we need a new QUEEN, TITS. Who is the ideal candidate? He or she is a fifth-to-ninth wave feminist who can speak with authority about the patriarchy while mollifying advertisers and reviewing panties, simultaneously appealing to men but never mentioning the issue of class. If that’s you, send us a photo of you at the beach.

To the entire media establishment BuzzFeed is a big deal—its traffic is besting that of more established peers and it has hired nearly one-third of the people in New York City. That’s why we need an EDITOR, BUZZFEED. You will not edit BuzzFeed (apparently someone does that already) but instead will edit a new vertical totally dedicated to repeatedly explaining how BuzzFeed, despite simply being a very large and well-funded blog, represents the future of the media. Articles we’d like to see include: “Is this the future of media?” “Is the future of media this?” and “Media’s future?” The ideal candidate can work the words “platform” and “ecosystem” into anything.

Are you a native full-stack visiongineer who lives to marketech platishforms? Then come work with us as an in-house NEOLOGIZER and reimaginatorialize the verbalsphere! If you are a slang-slinger who is equahome in brandegy and advertorial, a total expert in brandtech and techvertoribrand, and a first-class synergymnast, then this will be your rockupation! Throw ginfluence mingles and webutante balls, the world is your joyster. The percandidate will have at least five years working as a ideator and envisionary or equiperience.

Come help maintain viral aggregation’s secret shame! As READER, REDDIT, you will read Reddit and create the Redditorial that drives most of our traffic! Successful applicants will demonstrate the ability to avoid eye contact.

Our enterprise is seeking a full-time FAT SHAMER who can work across social media and blogs. Every day you will identify celebrities who have gained small or large amounts of weight and make remarks like “step away from the buffet table” &c., including the classic “oink!” Truly great fat shamers will not limit themselves to criticizing the bodies of famous women but will also draw attention to regular women who have been forced into the news cycle, including victims of violence and the mothers of slain children—because who couldn’t stand to lose a few? Successful candidates will be able to write the words “just sayin’!” seven thousand times per month without killing themselves. No fatties.

#Trendit! We have an immediate opening for a world-class OUTRAGE OPTIMIZATION EXPERT to furyhack our traffic across social media. The ideal candidate has proven abilities at composing rage pegs for any story and has demonstrated the ability to prefix any tweet with “THIS.” or “LISTEN.” Candidates will be required to flame out in two years and disavow their past views while encouraging their still-seething acolytes to “moderation.”

As our animal-based verticals have grown we are in need of someone with a liberal-arts-degree who can blog in the voice of a MEERKAT NAMED PHILBIN. For whatever reason the meerkat is like 80% of our traffic and the last person left to run the new Quantum Physics vertical at BuzzFeed. Help.

via Zero Hedge http://ift.tt/1wGUW3R Tyler Durden

 

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